PLANET,INC. FY2026 Q1 Earnings Report

Financial Highlights

• Net Sales: ¥795M
• Operating Income: ¥172M
• Net Income: ¥121M
• EPS: ¥18.25

Income Statement

Balance Sheet

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend Information

Full Year Forecast

Disclaimer

This data was automatically extracted from XBRL files. Please refer to the original disclosure documents for accuracy.

AI Financial Analysis

Executive Summary

Planet Co., Ltd. (single-entity, JGAAP) delivered resilient FY2026 Q1 earnings despite a slight topline dip. Revenue was 795 million yen (-1.5% YoY), while operating income rose sharply to 172 million yen (+33.8% YoY), signaling strong cost discipline and/or mix improvements. Gross profit was 507 million yen, implying a robust gross margin of 63.8%, consistent with a high-value, network/service model. Operating margin expanded to 21.6%, reflecting efficiency gains in SG&A. Ordinary income exceeded operating income at 178 million yen, indicating approximately 6 million yen of net non-operating gains, modest and likely recurring financial income. Net income was 121 million yen (+20.5% YoY), with an inferred effective tax rate near 29.3%. DuPont decomposition indicates an NPM of 15.2%, asset turnover of 0.119x (quarterly), and financial leverage of 1.18x, producing a quarterly ROE of 2.14% (roughly 8.6% annualized assuming stability). Balance sheet strength is notable: total assets are 6,663 million yen, equity 5,648 million yen, and liabilities 1,018 million yen, yielding very low leverage (~0.18x liabilities/equity). Liquidity is ample with a current ratio of 6.9x and no inventories, consistent with an asset-light service model. Working capital stands at 2,981 million yen, supporting ongoing operations and resilience. Cash flow statements were not disclosed this quarter (zeros reflect non-disclosure), so FCF and OCF-based quality assessments are necessarily limited. Dividend details were also not disclosed; EPS was 18.25 yen. Overall profitability quality appears solid given margin expansion against a slightly contracting revenue base, and balance sheet metrics suggest conservative financial risk. The key watchpoint is sustainability of cost efficiencies and revenue stability in subsequent quarters. Given the data gaps (cash flows, depreciation, share count), conclusions on cash conversion and dividend capacity are provisional, and we rely primarily on income statement strength and balance sheet conservatism.

Profitability Analysis

ROE decomposition (DuPont): Net profit margin 15.22% × asset turnover 0.119 × financial leverage 1.18 ≈ 2.14% for the quarter (≈8.6% annualized if sustained). Gross margin of 63.8% reflects a high value-added, likely subscription/transactional service profile. Operating margin at 21.6% (172/795) improved meaningfully YoY given operating income growth outpaced revenue; SG&A ratio is inferred at 42.2% of sales (335 million yen), indicating effective cost control. Ordinary margin of 22.4% benefits modestly (~0.8% of sales) from non-operating income. Effective tax rate is estimated at ~29.3% (50.249 / (121 + 50.249)), in a normal range for Japan. Operating leverage appears favorable this quarter: a -1.5% revenue change paired with +33.8% operating income suggests fixed-cost absorption improvements and/or mix/pricing tailwinds. Absence of reported depreciation (likely undisclosed) limits EBITDA analysis; nevertheless, margin gains at both gross and operating levels signal underlying efficiency.

Growth Assessment

Topline contracted marginally (-1.5% YoY), but profitability improved considerably, implying mix optimization or disciplined pricing in core services. The widening gap between gross profit and operating income suggests SG&A efficiencies as the key driver of earnings growth. Non-operating income contribution is small but supportive. Given the asset-light model and lack of inventories, revenue likely correlates with transaction volumes and/or subscription renewals; short-term growth visibility thus hinges on client retention and usage intensity. The quarter’s NPM of 15.2% and OPM of 21.6% provide headroom to absorb modest revenue volatility. Sustainability into FY2026 will depend on maintaining SG&A discipline without constraining growth investments. With an annualized asset turnover near ~0.48x (quarterly 0.119 × 4), incremental revenue growth is likely to translate into disproportionately higher operating profit if fixed costs remain contained. Outlook: cautiously constructive on earnings resilience; topline trajectory requires confirmation in Q2–Q4 to validate whether Q1 revenue softness is temporary or structural.

Financial Health

Liquidity is very strong: current assets 3,488 million yen vs current liabilities 507 million yen yields a 6.9x current ratio (and quick ratio the same given no inventories). Working capital is 2,981 million yen, offering ample operating flexibility. Solvency is conservative: liabilities/equity ~0.18x and leverage (assets/equity) ~1.18x, indicating low balance-sheet risk. Equity ratio appears undisclosed in the source (reported 0.0%), but implied equity ratio is approximately 84.8% (5,648/6,663). The absence of reported interest expense is consistent with low debt, though exact debt composition is not disclosed. Overall capital structure is robust and supports ongoing investment and shareholder returns, subject to actual cash balances and future cash generation.

Cash Flow Quality

Operating, investing, and financing cash flows were not disclosed this quarter (zeros denote non-disclosure, not true zeros), preventing direct assessment of cash conversion or FCF. Earnings quality is inferred from margins and cost behavior: strong gross and operating margins alongside stable non-operating items point to recurring earnings. Working capital appears ample, but without receivables/payables breakdowns, changes in working capital cannot be analyzed. Free cash flow cannot be computed without OCF and capex; depreciation was not reported, which limits capex proxies under JGAAP. Given the asset-light profile and low leverage, cash generation is likely healthy, but this remains an assumption pending CF disclosure.

Dividend Sustainability

Dividend data (DPS and payout) were not disclosed for the quarter. With EPS at 18.25 yen for Q1 and robust margins, earnings capacity appears sufficient to support distributions under a typical asset-light model. However, without OCF/FCF, we cannot assess cash coverage. Balance sheet strength (equity ratio implied ~85%, low liabilities) provides flexibility for dividends, but sustainability should be anchored to recurring OCF. Policy outlook is therefore undetermined this quarter; confirmation requires management guidance or historical policy context and cash flow statements in subsequent filings.

Risk Assessment

Business Risks:

• Topline softness (-1.5% YoY) may indicate demand normalization or client optimization of usage.
• Dependence on transaction volumes/subscription renewals could expose revenue to macro or industry activity swings.
• Potential pricing pressure from competitors or client consolidation.
• Technology/platform reliability and cybersecurity risks inherent in data/EDI services.
• Customer concentration risk if key accounts contribute a large share of revenue (not disclosed).

Financial Risks:

• Limited visibility on cash generation due to non-disclosure of cash flow statements this quarter.
• Potential interest rate risk on financial income if non-operating gains stem from deposit yields.
• Tax rate variability (estimated ~29%) could affect net margins.
• Unknown off-balance or lease commitments under JGAAP disclosures not detailed here.

Key Concerns:

• Sustainability of cost efficiencies that drove OI growth against a declining revenue base.
• Lack of OCF/FCF data restricts assessment of earnings-to-cash conversion and dividend capacity.
• Revenue visibility for FY2026 given Q1 decline; need confirmation of demand recovery in subsequent quarters.

Investment Implications

Key Takeaways:

• Margin-driven earnings beat: OI +33.8% YoY on -1.5% revenue demonstrates strong cost control and mix.
• High-quality margin structure: 63.8% GP and 21.6% OP margins underpin earnings resilience.
• Conservative balance sheet: liabilities/equity ~0.18x and implied equity ratio ~85%.
• Modest, stable non-operating gains (~6 million yen) provide incremental support to ordinary income.
• Data gaps (cash flows, depreciation, DPS) limit conclusions on cash conversion and capital returns.

Metrics to Watch:

• Revenue growth re-acceleration (YoY and QoQ) and client activity indicators.
• SG&A-to-sales ratio and operating margin sustainability.
• Asset turnover trend and annualized ROE progression.
• Disclosure of OCF and capex to evaluate FCF conversion and dividend coverage.
• Composition of non-operating income (interest and other) amid changing rate environment.
• Cash and short-term investments levels within current assets.

Relative Positioning: Compared with typical asset-light, network-based service peers on the TSE, Planet exhibits stronger balance sheet conservatism and comparable-to-higher operating margins, though near-term revenue growth is slightly weaker this quarter; confirmation of demand trends and cash conversion would solidify its relative quality profile.

Disclaimer

This analysis was auto-generated by AI. Please note the following:

• No Guarantee of Accuracy: The accuracy and completeness of this analysis are not guaranteed. For accurate financial data, please refer to the original disclosure documents published on TDnet or other official sources
• Not Investment Advice: This analysis is for general informational purposes only and does not constitute investment advice under applicable securities laws. It is not a recommendation to buy or sell any specific securities
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